Section 8 Company or a Non-Profit organisation (NPO) is a Company established for promoting commerce, art, science, religion, sports, education, research activities, charity or any other useful social object, provided the profits and donations is applied for promoting only the objects of the company and no dividend is paid to its members or owners.
The term No Profit does not mean that the Company cannot generate profit or income, but what it means is applying the income for promotion of the object and not for distributing it to the promoters. It means that the Company can earn profits but the promoters cannot be benefitted out of those profits.
1. Many privileges and exemptions are available to section 8 company under Company Law
2. Exemption from requirement of Minimum Paid-up capital
3. Exemption of Stamp duty for registration
4. Non-application of Companies Auditor's Report Order (CARO)
5. Registered partnership firm can be a member in its own capacity
6. Tax deductions to the donors of the Company u/s. 80G of the Income Tax
